Presentation Materials
for the 11th Fiscal Period Ended
August 2023
Securities Code︓3488

Basic Principles and Characteristics of XYMAX REITXYMAX REIT accurately assesses the value of individual properties to maximize unitholder value. We fully utilize ourstrength in Management, Assessment, and Sourcing based on the knowledge and know‐how of the XYMAX Group, which
has Japan’s No.1 track record in property management.
Terms

Definition

Estimated value atthe end of period

Indicates the acquisition value appraised by the appraisers or the research
price based on the Articles of Incorporation of XYMAX REIT and the“Ordinance on Accountings of Investment Corporations” (Ministry of FinanceOrdinance No. 47 of 2006, as amended) with the last day of the current fiscal
period as the research dateUnrealized gain

Estimated value of real estate, etc. at the end of period – book value at theend of period

LTV based on total
assetsBalance of interest‐bearing liabilities / total assets

Appraisal LTV

Balance of interest‐bearing liabilities / (total assets + unrealized gain)

Net asset per unit

(Net asset ‐ total distribution) / total number of investment units issued andoutstanding

NAV per unit

(Net asset + unrealized gain ‐ total distribution) / total number ofinvestment units issued and outstanding

Acquisition price

The sales price of the acquired assets is indicated in each sales agreementand does not include consumption taxes, local taxes, and brokerage fees, etc.

Contents

Ⅰ. Management Highlights

Overview of Financial Results
Ⅱ.
and Earnings Forecasts
Ⅲ. Investment Status and Growth Strategy

Notes
 Unless otherwise specified, amounts are rounded to the nearest unit and ratios are rounded off tothe first decimal place.
 The following abbreviations of property names are used.

Ⅳ. ESG

Ⅴ. APPENDIXXYMAX Nishi‐Shimbashi Building : Nishi‐Shimbashi
XYMAX Iwamotocho Building
XYMAX Shinjuku‐Gyoen Building : Shinjuku‐Gyoen
XYMAX Kamiyacho Building
XYMAX Higashi‐Azabu Building : Higashi‐Azabu
XYMAX Higashi‐Ueno Building
XYMAX Hachioji Building: Hachioji
XYMAX Mita Building
XYMAX Sapporo Odori Building : Sapporo
XYMAX Kiba koen Building
Muza Kawasaki: MuzaLife Kawasaki Miyuki Store
Vita Seiseki‐Sakuragaoka: Seiseki‐Sakuragaoka Life Fukuizumi StoreThe Park House Totsuka Front (the Retail Portions of 1st and 2nd Floors)
Valor Kachigawa Store (Leasehold land): Kachigawa
Hotel Vista Sendai: Sendai
L‐Place Nishikasai: Nishikasai: Iwamotocho: Kamiyacho: Higashi‐Ueno: Mita: Kiba: Kawasaki Miyuki: Fukuizumi: Totsuka

2Management Highlights

Executive Summary The 11th FP results exceeded most recent forecasts (the “Forecasts”)
 Operating revenue 1.66 billion yen (up 1.2% from the previous period, down 0.1% from the Forecasts)
 DPU 3,166 yen (down 96 yen from the previous period up 92 yen from the Forecasts)

 The management of properties has driven steadily Offices: High occupancy rates were maintained through stable management, and the contract occupancy
rate was 99.1% and economic occupancy rate were 98.8% at the end of 11th FP
 Retail properties: All of the fixed‐term leases expiring during 12th FP are re‐contracted or re‐leased
without down‐time and a part of the new leases achieved higher rent at Muza.
 Hotels: Operating results exceeded the Forecasts, registering 22.2% greater variable rent revenue

 Implementation of measures focused on external growth Securing future pipelines by acquiring first refusal rights by investing in development‐type TMK Newly acquired the first refusal right for one property

 Ongoing and deepening of ESG initiatives
 Obtained “3 Star” and “Green Star” in the GRESB Real Estate Assessment for two consecutive years
3Management Highlights

Key Factors (at the end of 11th FP)
Debt

Asset
Number of properties
Asset size (based on acquisition
price)
Appraisal value

43.4 billion yen

Balance of interest‐bearing
liabilities

19.7 billion yen

LTV based on total assets

40.9%

Appraisal LTV

33.3%

Average borrowing rate*1

0.722%

55.0 billion yen

Unrealized gains(unrealized gain ratio)

10.9 billion yen (+24.8%)

Average remaining period

2 years 4 months

Profitability(based on acquisition price)

Appraisal NOI yield: 5.6%
Appraisal NOI yield after
depreciation: 4.8%

Fixed interest rate ratio

99.0%

Average building age (weighted
average of acquisition price)20.1 years

Total leasable area

85,319.85 ㎡ (25,809.07 tsubo)

Occupancy rate
(entire portfolio)

99.6%

Asset type(based on acquisition price)

*1:

18

Office:Retail:Hotel:
Others:

58.3%
29.5%
10.1%
2.1%

Interest rate for floating rate borrowings is calculated based on the JBA 1‐month Japanese Yen TIBOR as of August 31, 2023.

EquityAggregate market value

29.0 billion yen

Unitholders’ capital

25.4 billion yen(Total number of investment units
issued and outstanding: 249,650)

Investment unit price

116,200 yen

Net asset per unit

101,903 yen

NAV per unit

145,742 yen

Distribution per unit

3,115 yen (12th FP forecast)4

Overview of Financial Resultsand Earnings Forecasts

Overview of Financial Results and Earnings Forecasts

Overview of Financial Results
Operating revenue was 1,665 million yen, up 1.2% and net income was 790 million yen, down 2.9% from the previous
period, respectively.
Unit: million yen
the 10th FP(A)Difference(B)‐(A)the 11th FP(B)

Main factors for difference (B)‐(A)Leasing business revenue

1,497

1,517

20

Other leasing businessrevenue

148

147

‐1

1,646

1,665

19

422

453

31

1,224

1,211

‐12

162

168

5

1,061

1,043

‐17

152

161

8

908

882

‐26

Non‐operating income

0

2

1

Refunds of overcharged water bills (+2.1)

Non‐operating expenses

94

93

‐0

Interest increased due to higher average interest rate after refinancing (+7.9)
Absence of Loan‐related expenses (‐8.7)

Ordinary income

815

791

Net income

814

790

3,262

3,166*1

‐23
‐23
‐96

Comparison with the distribution forecast released in April 2023 (3,074 yen)
+92 yenOperating revenue
Expenses related toleasing business(Excluding Depreciation)
NOI
Depreciation
Leasing business income
Other operating expenses
Operating income

Distribution per unit (yen)Office rent revenue (+4.1), Hotel rent (variable rent +16.7)

Commencement of property tax and city planning tax payments pertaining tofour assets acquired in 2022 (+16.7)
Increase in repair expenses (+16.3)

Posting general unitholders’ meeting related expenses (+5.1)

Days: 10th FP: 181 days, 11th FP: 184 days
*1: Includes a distribution in excess of earnings per unit of 7 yen related to the allowance for temporary differences adjustments.

6

Overview of Financial Results and Earnings Forecasts

Assumptions for Earnings Forecasts for the 12th FP and 13th FP

Property
management
related

Office• Economic occupancy rate
12th: 98.0% (as of the end of 12th FP), 13th: 97.0% (as an average)• Maintenance costs
Assumed certain level of increase considering price increase demand in BM costs

Retail12th FP: Rent revenue increase by 3.7% due to re‐contract and tenant replacementwith expiring fixed‐term leases and a lease renewal(Musa: 2 spaces, Totsuka: 1 space)

Fixed rent: 20.5 million yen/month

Hotel

Variable rent: (GOP for the past one year, counting from the month preceding the current month ÷ 12 –21.5 million yen) x α%Compared with the same period in 2019:12th FP …. GOP is estimated assuming Sales 97.5%, Expenses 104.7%
13th FP …. GOP is estimated assuming Sales 101.7%, Expenses 108.5%

Corporate
management
related Non‐operating expenses
Posting loan‐related expenses associated with refinancing of 4,376 million yen at the end of January 2024
(during the 12th FP)
Average interest rates after the refinancing are also expected to increase7

Overview of Financial Results and Earnings Forecasts

Earnings Forecast for the 12th FP ending February 2024
Unit: million yen
the 12th FP
forecast (B)the 11th FP(A)Difference(B)‐(A)

Main factors for difference (B)‐(A)Leasing business revenue

1,517

1,520

3

Office rent revenue (‐4.1), Hotel rent (variable rent +11.2)

Other leasing businessrevenue

147

149

1

Increase in electricity charges invoiced to tenants (Sapporo: +3.0 due toseasonal factors)

1,665

1,670

4

Operating revenue
Expenses related toleasingbusiness (Excluding
Depreciation)

Decrease in repair expenses (‐12.0)
Increase in leasing cost (+14.2)
Increase in electricity charges (Sapporo: +5.3 due to seasonal factors)
Increase in BM fees (+1.2 in consideration of inflation)

453

457

4

1,211

1,212

0

168

169

1

1,043

1,043

161

157

‐0
‐3

882

885

3

Non‐operating income

2

0

‐2

Absence of refunds for overcharged water bills (‐2.1)

Non‐operating expenses

93

107

13

Accrual of loan‐related expenses associated with refinancing
Increase in interest due to higher interest rate at refinancing (+13.6)

Ordinary income

791

778

Net income

790

777

‐12
‐12

3,166

3,115

‐51

NOI
Depreciation
Leasing business income
Other operating expenses
Operating income

Distribution per unit (yen)Days: 11th FP: 184days, 12th FP: 182 days

Absence of general unitholders’ meeting related expenses (‐5.8)

Comparison with the distribution forecast released in April 2023 (3,010 yen)+105 yen8

Overview of Financial Results and Earnings Forecasts

Earnings Forecast for the 13th FP ending August 2024
Unit: million yen
the 12th FP
forecast (A)the 13th FP
forecast (B)Difference(B)‐(A)

Main factors for difference (B)‐(A)Leasing business revenue

1,520

1,523

2

Rent revenue from offices and retail (+12.0)

Other leasing businessrevenue

149

142

‐6

Decrease in electricity charges invoiced to tenants (Sapporo: ‐1.9 due toseasonal factors)

1,670

1,665

‐4

Operating revenue
Expenses related toleasing business(Excluding Depreciation)
NOI
Depreciation
Leasing business income
Other operating expenses
Operating income
Non‐operating income
Non‐operating expenses

457

457

‐0

1,212

1,208

‐3

169

172

3

1,043

1,036

‐7

157

158

1

885

877

‐8

0

0

‐

107

104

‐2

Ordinary income

778

772

‐6

Net income

777

771

‐6

3,115

3,091

‐24

Distribution per unit (yen)Increase in repair expenses (+6.7)
Decrease in leasing cost (‐14.3)
Decrease in electricity charges (Sapporo: ‐4.3 due to seasonal factors)
BM fee (+0.9 in consideration of inflation)
Tax and public dues (in consideration of revaluation +3.3)

Absence of loan‐related expenses associated with refinancing
Increase in interest due to higher average interest rate following
refinancing (‐2.5)

Days: 12th FP: 182 days, 13th FP: 184 days

9

Investment Status and Growth Strategy

Investment Status and Growth Strategy

Status of Office Tenant –Occupancy Rate & Tenant Replacements –┃Status of occupancy rate & tenant replacements┃• Office properties (exc. obligated residences)
Economic
occupancy rate
for the 13th FP(forecast)

Scope area for the 11th FP and 12th FP: 8,213.28 tsubo(tsubo)
500
400
300

92.6%

99.2%

99.1%

98.6%

98.8%

99.2%

98.7%

98.8%

98.0%

8%

Average

97.0 %

4.2%
348.53271.88

0.9%
76.23

0

0.00

-100
-200

99.2%

5.4%

200
100

98.8%
94.3%

0.0%

74.56

0.9%

69.12

74.57

0.8%

0.9%

1.9%
69.12

427.574%

0.8%
155.48156.84159.90

1.9%

1.9%

-300

Contract occupancy rate
at the end of FP
0%

Economic occupancy
rate at the end of FP
Occupancy rate*1
Surrender rate*2

-4%

■
■

Area contract start
Area contract end

-400
-500

6.6％

7th FP-8%

8th FP

9th FP

10th FP

11th FP

12th FP(forecast)

2.5

3.0

2.7

10th FP

11th FP

12th FP(forecast)┃Average of free rent period ┃• Office properties (exc. obligated residences)*3(month)
5
4
3
2
1
0

2.8
7th FP

3.6

4.0

8th FP

9th FP*1: Occupancy rate: area contract start ÷ Total leasable area
*2: Surrender rate: area contract end ÷ Total leasable area
*3: Average of free rent period: free rent period granted in contracts whose contract period start in each FP (new leases) x total contract area of contracts with free rent granted in new leases ÷ total area where new contracts start11

Investment Status and Growth Strategy

Status of Office Tenant – Tenant Replacement & Contract Renewal –┃Status of tenant replacement and contract renewal┃• Office properties (exc. obligated residences)(tsubo)

1,500
1,400

1,000
900

‐0.9%

0.6%

500

(100)

‐0.1%

170.81■ Replacements with higher rent
■ Renewals with higher rent
■ Replacements with lower rent
■ Renewals with lower rent

0.4%

Highlights for the 11th FP

70.67
46.08
91.48
250.41

23.04
76.23

38.3
72.26
36.26

228.69

23.04
95.84
23.04

377.4484.81

 3 new leases(1 space with the same rent, 1 space with higher rent, and1 space with lower rent)→Change +5.0% (Monthly rent increased by 54 thousand yen) 31 renewals(26 spaces with the same rent, 2 spaces with higher rent,and 3 spaces with lower rent)→Change ‐0.1% (Monthly rent decreased by 60 thousand yen)228.69Forecast for the 12th FP

344.48-500(600)% change of rent uponrenewal*1% change of rent upon
replacement*2

1.3%‐16.7%

76.23
467.14

0

0.3%
‐0.5%

‐1.5%
‐15.3%

400

‐1.1%

5.0%

7th FP

8th FP

9th FP

10th FP

11th FP

12th FP(forecast)

For renewal (tsubo)

1,903.66

1,307.30

883.01

1,339.31

2,983.10

2,820.94

For new lease(tsubo)271.88348.53

76.23

74.56

69.12

155.48

 3 new leases (1 space with higher rent and 2 spaces withlower rent)→Change +1.3% (Monthly rent increased by 32 thousand yen)
 35 renewals (32 spaces with the same rent and 3 spaces
with higher rent)→Change +0.4% (Monthly rent increased by 176 thousand yen)

┃ Floor area scheduled for contract renewal ┃• Office properties (exc. obligated residences)■① Rent gap*3: over 10％■②Rent gap: over 0％ less than 10％■③ Rent gap: over ‐10％ less than 0％ ■④Rent gap: ‐10％ or less(tsubo)
3,000

2,000

(Office space only)

2,820.94（35 spaces）
1,000

12th FP

1,649.81（15 spaces ）1,474.54（20 spaces ）（21 spaces ）13th FP

14th FP

15th FP

1,108.44

0Rent gap at the end of
11th FP
Unit rent for existing contracts*4:
16,311 yen/tsubo
Assumed new unit rent*4:
16,232 yen/tsubo*1: % change of rent upon renewal: (rent that includes CAM revenue after renewal – rent that includes CAM revenue before renewal) ÷ rent that includes CAM revenue before renewal*2: % change of rent upon replacement: (rent that includes CAM revenue after tenant replacement – rent that includes CAM revenue before tenant replacement) ÷ rent that includes CAM revenue before tenant replacement*3: Rent gap (contractual unit rent – assumed new unit rent) ÷ assumed new unit rent
*4: The various unit rents: using a monthly unit rent that includes CAM revenue.

12Investment Status and Growth Strategy

Trends in Office Market and Advantages of XYMAX REIT (1)The 10 office properties held by XYMAX REIT Investment Corporation
Unit rent for existing contracts: 16,311 yen/tsubo; average minutes from the nearest station*1: 2.7 minutes; average building age*2: 21.1
years; average floor area: 1,095 tsubo*1: Simple average of the time required to walk to the nearest station at the 10 office properties*2: The weighted average of the building age of the 10 office properties was calculated using the total floor area (at the end of the 11th FP).

Distribution of contracts concluded in the 23 wards ofTokyo (by unit price of contracted rent)

（%）
20
18
16
14
12
8
6
4
2
0
（%）
20
18
16
14
12
8
6
4
2
0

（％）
14.00
All locations(combined)

Apr. – Jun. 2012
Number of cases: 593
Number of targeted
properties: 568

12.00

Within a 3‐minute walk to the nearest station
3‐5 minute walk to the nearest station
More than a 5‐minute walk from the nearest station

10.00

Apr. – Jun. 2020
Number of cases: 622
Number of targeted
properties: 577

8.00

6.00

Properties with more than a 5‐minute walkfrom the nearest station are the first to
register higher vacancy rates

4.00

Apr. – Jun. 2023
Number of cases: 1,047
Number of targeted
properties: 1,047

2.00

0.00

Unit rent (yen/tsubo)
Source: Created by XYMAX Real Estate Institute upon the Management Company request of Asset Management Company

201104
201109201202
201207
201212
201305201310201403
201408201501
201506201511
201604
201609201702
201707201712
201805201810201903
201908202001202006202011202104202109202202202207202212202305

（%）
20
18
16
14
12
8
6
4
2
0

Large segments ofcontracts concludedin the market

Vacancy rate by time required to walk to the nearest
station in the 23 wards of Tokyo

Source: Created by XYMAX Real Estate Institute upon the request of Asset Management Company

13

Investment Status and Growth Strategy

Trends in Office Market and Advantages of XYMAX REIT (2) For the majority of the office contracts concluded, unit rents are in the range from 10,000 yen and 20,000 yen, indicating a substantial demand for this range
 A gap in the vacancy rate has arisen between properties with more than a 5‐minute walk from the nearest station and those within a 5‐minute walk
 In both existing stock and new supply in the future, small‐ and medium‐scale office buildings are limited compared with large‐scale office buildings
 XYMAX REIT maintains high occupancy rates at office properties due to the aforementioned superior characteristics of the properties it owns, as well as utilization of
the XYMAX Group’s management strength┃ Office Stock Pyramid 2023 covering the 23 wards (net rentable area) ┃23 Wards of Tokyo:13.11 million tsubo, 9,400
buildings, average building age: 33.4 years(Gross floor area: 300‐5,000 tsubo)
Whole: 6.07 million tsubo, 8,642 buildings,
34.2 years on average(tsubo)Large‐scale office buildings (Gross

Small‐ and medium‐scale office buildings
75

floor area: 5,000 tsubo or more)

70

Whole: 7.04 million tsubo,
758 buildings, 25.0 years on average

65

Volume of new offices in Tokyo’s 23 wards in 2023
(net rentable area)

300,000

Average for2013‐2022

250,000
224,000

40

The building age was concentrated in.
The average building age of the properties
held by XYMAX REIT

35
30
25
20

200,000

Old seismic standard:
0.91 million tsubo,
(13%)

50

Building age (years)

20 years or older:
5.06 million tsubo, (83%)

177,000 179,000
151,000

20 years or older:
3.91 million tsubo, (56%)

150,000
272,000

40

30

100,000

75,000

5
10

10

20

30

40

102,000

88,00099,000104,000＊
0080,00064,00035,000Rentable area (ten thousand tsubo).

124,000
158,000
104,000

147,000

50,000Less than 20 years:
3.13 million tsubo, (44%)

204,000

115,000

151,000
125,000

10

20

118,000
142,000
182,000

110,000050

180,000
168,000

15

Less than 20 years:
1.01 million tsubo, (17%)

158,000 tsubo

213,000

55

45

275,000

159,000 tsubo

60
Old seismic standard:
1.40 million tsubo(23%)

Average for2023‐2026

50

Source: Survey Report by XYMAX Real Estate Institute Corp.
“[23 Wards of Tokyo] Office Stock Pyramid 2023”

26,00026,00037,00031,00016,00016,00021,00036,00016,00020,00022,0003,000

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
* Supply of small‐ and medium‐scale office buildings (with floor area between 3,000 and 10,000 tsubo)

Total floor area 3000‐9,999 tsubo
Total floor area 10,000 tsubo or more

Source: Survey Report by XYMAX Real Estate Institute Corp.
“[23 Wards of Tokyo] Volume of new offices in 2023”

14

Investment Status and Growth Strategy

Trends of Office Demand and Workplace
A greater proportion of respondents are expecting an increase in the number of employees in their offices, with anincreasing preference for expanding their floorspace.
Meanwhile, office floor demand is expanding outside of urban centers, in line with expanding demand for satellite offices.
┃Expected trend in the number of employees at the office┃┃Actual changes in office space in the past one year and potentialchanges in the future┃
Expansion

Total percentage of
those expanded:18.4%

Reduction

Spring 2017(n=1,073)
Spring 2018(n=1,250)
Spring 2019(n=1,278)
Spring 2020(n=1,795)
Spring 2021(n=1,648)
Spring 2022(n=1,537)
Spring 2023(n=1,722)■Increase ■No change ■ Decrease■ Not sure
Targeted respondents: All
Source: “Metropolitan Area Office Demand Survey Spring 2023” by XYMAX Real Estate Institute┃Adoption rate of remote working systems and satellite offices┃

Although intentions todownsize office spaceexceeded intentions to
expand in the past two
years, the trend reversed
in 2023

Total percentage of
those reduced:4.9%

Spring2019(n=1,278)【Actual】

Spring2020(n=1,795)■ Expanded■ Reduced■ DI (Total percentage of those expanded– total percentage of those reduced)

Spring2021(n=1,648)

Spring2022(n=1,537)

Spring2023(n=1,722)【Potential】■ Considering to expand■ Considering to reduce■■ Considered but stopped/suspended

Targeted respondents: All

Source: “Metropolitan Area Office Demand
Survey Spring 2023” by XYMAX Real
Estate Institute┃Number of flexible office locations ┃Spring 2017(n=1,073)(Number ofproperties)

Spring 2018(n=1,250)

RemoteworkingsystemSpring 2019(n=1,278)
Spring 2020(n=1,795)
Spring 2021(n=1,648)
Spring 2022(n=1,537)
Spring 2023(n=1,722)
Spring 2017(n=1,073)
Spring 2018(n=1,250)

Satellite
officeSpring 2019(n=1,278)
Spring 2020(n=1,795)
Spring 2021(n=1,648)
Spring 2022(n=1,537)

While adoption of
remote working systems
is decreasing, theadoption of satellite
offices is increasing( five wards of Tokyo/18 peripheral wards )Since the COVID19
pandemic, more
stores are being
opened outside ofurban centers

Spring 2023(n=1,722)
Targeted respondents: All/multiple answers/excerpt/recounting

Source: “Metropolitan Area Office Demand Survey Spring 2023” by XYMAX Real Estate Institute■5 wards of Tokyo ■18 peripheral wards
Source: “Flexible Office Market Survey 2023 ” by XYMAX Real Estate Institute15

Investment Status and Growth Strategy

Portfolio Status: Hotel Vista Sendai
The operator engaged in ADR‐focused business management, ending up with a higher GOP in the 11th FP, exceeding
the Forecasts.
For the 12th and 13th FPs, operating expenses were conservatively estimated in budgeting variable rent.
┃Trends in sales and expenses┃┃Monthly trend of ADR and occupancy rate┃
Actual figures during the period between Sept. 2022 and Sept. 2023
The same month in 2019100.0%

Occupancy
rate■■Sales■■ Expenses■■Sales■■Expenses

75.0%

101.7
100.0

50.0%

(yen) 13,000
12,000

95.0

99.4

100.0

94.1

95.0

97.5

108.0

104.7

Actual figures during the period between Sept. 2022 and Sept. 2023
The same month in 201911,00010,000

ADR
9,000

100.0

108.0 102.4 108.5

100.0

102.5

2019 B

10th FP

8,000
7,000
6,000

2019 A
Sept.
2022

Oct.
2022

Nov.
2022

Dec.
2022

Jan.
2023

Feb.
2023

Mar.
2023

Apr.
2023

May
2023

June
2023

July
2023

Aug.
2023

Sept.
2023

* The occupancy rates, ADR, sales, and expenses on this page are actual figures for each period.

11th FP

11th FP

13th FP(Previous(Actual)(forecast)

forecast)

12th fP

12th fP(Previous(Current

forecast)

forecast)*2019 A: March 2019 to August 2019 *2019 B: September to December 2019 and January to February 201911th FP: from March 2023 to August 2023, 12th FP: from September 2023 to February 2024, 13th FP: from March 2024
to August 2024

16

Investment Status and Growth Strategy

Portfolio Status: Hotel Vista Sendai
Variable rents are calculated using the moving‐average method, with reference to the GOP in the past one year.
Variable rents in the 11th FP increased substantially compared with the 10th FP, since it covers the period after relaxationof restrictions on movement.
┃Rents before and after the COVID‐19 pandemic┃
Lease conditions in the 3rd and 4th FP: Monthly fixed rent of 20 million yen + variable rent (GOP for the past one year, counting from the current month ÷ 12 – 21 million yen) x α%*1
Lease conditions in FPs from the 10th FP onward: Monthly fixed rent of 20.5 million yen + variable rent (GOP for the past one year, counting from the month preceding the current month ÷ 12 – 21.5 million yen) x α%*1
(million yen)

3th FP

4th FP

10th FP

11th FP

12th FP(forecast)

13th FP(forecast)(Mar. 2019 to Aug. 2019)(Sept. 2019 to Feb. 2020)(Sept. 2022 to Feb. 2023)(Mar. 2023 to Aug. 2023)(Sept. 2023 to Feb. 2024)(Mar. 2024 to Aug. 2024)

163.9

161.2

126.4

143.1

154.4

154.3

Fixed rent

120.0

120.0

123.0

123.0

123.0

123.0

Variable rent

43.9

41.2

3.4

20.1

31.4

31.3

100.0

97.9

69.8

83.4

91.4

91.3

Total rent
(Breakdown)

GOPPAR Index*2*1: 0 yen, If the results of the calculation are negative *2: The GOPPAR Index is indexed by setting the GOPPAR for the period used for calculating the variable rents in the 3rd FP at 100.

┃Trend of occupancy rate and ADR for the period used to calculate the variable rents in each month*┃
From the 10th FP to the 13th FP

100.0%
Occupancyrate

The same month in the 3rd and 4th FPs

90.0%
80.0%
70.0%

(yen) 11,000

10,000
9,000
ADR
8,000
7,000
6,000
Sept.
2022

Oct.
2022

Nov.
2022

Dec.
2022

Jan.
2023

Feb.
2023

Mar.
2023

Apr.
2023

May
2023

June
2023

July
2023

Aug.
2023

Sept.
2023

* The occupancy rates and ADR shown in this graph are those for the period used to calculate variable rents in each month.

Oct.
2023

Nov.
2023

Dec.
2023

Jan.
2024

Feb.
2024

Mar.
2024

Apr.
2024

May
2024

June
2024

July
2024

Aug.
2024

17

Investment Status and Growth Strategy

Portfolio Status: Retail Properties
Succeeded in increasing rent in re‐contract and replacement negotiations for the expiring fixed‐term leases at
Muza.
 All retail properties owned by XYMAX REIT are located in the suburbs of large metropolitan areas, where robust business conditions
are expected for tenants.
 Most of the tenants leasing the master lease properties are daily use type of business with steady sales.
 In conjunction with changes in how retail properties are used, we intend to maintain and improve asset value in leasing byconsidering a wide array of industries beyond the existing industries.

┃ Properties of XYMAX REIT ┃MuzaBreakdown of properties by type
(Based on rent revenue)

Multi‐tenant
properties
Master leaseproperties

66%

Muza

34%

 The 12th FP: Leases will be terminated for 10 spaces (428.03 tsubo) out of all
20 spaces.
 9 out of 10 of the spaces have been re‐contracted with existing tenants,
while economic terms were agreed upon with a new tenant for 1 space.
 No lowered rent or downtime at any of the 10 spaces, 2 spaces with higher
rent.

Totsuka■ The 12th FP: Contract renewal with higher rent at 1 space
Totsuka(As of August 31, 2023)

Monthly rent increased by 369 thousand yen, change +3.7%
18Investment Status and Growth Strategy

Status of Repair and Capital Expenditure
Repair expenses are annually controlled with reference to long‐term repair expenses adopted in the ER.
We are realizing rent increases through a reduction of environmental burden and value enhancement by equipment
construction works described below.
┃Trend of repair expenses and capital expenditure┃┃Major equipment renovations in the 11th FP ┃Repair expenses
Depreciation(thousand yen)

Capital expenditure
Average ER

Property name

Description of construction work

Reduction in power usage(rate of reduction*)

Shinjuku‐
Gyoen

Renewal for air conditioning system in
exclusive spaces (1 floor)

31,671kWh/year (51.1%)

Shinjuku‐
Gyoen

LED replacement in exclusive spaces(2 floors)

45,430kWh/year (73.3％)

Kamiyacho

LED replacement in exclusive spaces(2 floors)

15,775kWh/year (71.6％)

Hachioji

LED replacement in exclusive spaces(partials of the spaces)

3,825kWh/year (70.8％)

200,000（坪）

178,630

168,177

180,538

172,651

158,887
160,000
154,511

169,191

162,568

164,258

120,000
116,384* Rate of reduction: Reduction in annual power usage ÷ Annual power usage prior to renovation (estimation)┃Increase in revenue through value enhancing construction work ┃80,000(Mita)
before55,48349,50040,00044,748050,208

Approximately +55%
43,415

39,128after
9th FP

Increase/decrease in rent
(monthly rent)

10th FP

11th FP

12th FP(forecast)

13th FP(forecast)* Number of properties as of the end of each FP: 18* Average ER is the FP average of repair expenses required over 12 years for the purpose of long‐term repair
expenses for ER, as calculated by the Asset Management Company.

 A strategy to attract tenants on morefavorable terms by reducing the initial costthrough interior renewal to reduce thetenant’s cost burden in interior construction
as well as restoration work at the time of thetenant’s move‐in or out.
 Contributing to increase revenue througheffective value enhancement.

19

Investment Status and Growth Strategy

Asset Acquired in the 11th FP
As its first business initiative, XYMAX REIT acquired preferred investment securities of a development‐type TMK by using
cash on hand.
We acquired the first refusal right for the properties to be developed by the TMK, on top of the aforementioned preferredinvestment securities.
┃Outline of the asset acquired┃
Asset acquired

Preferred investment securities of TMK Hirakata Retail
Facility Development

Acquisition price

1st Preferred Investment Securities 28 million yen
2nd Preferred Investment Securities 22 million yen (planned)
Total amount (1st + 2nd) is approximately 4.5% of total
preferred investment securities

Underlying realestate (property fordevelopment)
Classification

Buildings

Land

Location

Hirakata Retail Facility (tentative name)・This project was materialized based on cooperation with XYMAX Group
companies
Clients of
XYMAX Group(prospects toopen stores)Type ofownership

General fixed‐term land leasehold rightUse

Stores and clinics

XYMAX Group2Land owners

3
Consent to theeffective use of landthrough leasing

XYMAX

Approx. 14,000㎡

Approx. 9,000㎡

1

4

Hirakata, Osaka Prefecture

Total floor area

Negotiation for the useof land

Capture store opening
needs

Retail facilities

Site area

Expected typeof tenants┃Background of the acquisition┃: Formulating development plans for retail facilities (merchandising planning,
attracting tenants, negotiation with authorities regarding development
concerning the retail facilities)
MAX‐REALTY: Financial arrangement and asset management of the TKM
5Daily use type of business* Fixed‐term building lease reservation agreements havealready been concluded.

XYMAX REIT
★Effective utilization of cash on hand
Purpose of acquisition of★Acquisition of first refusal rights
preferred investment★Creation of opportunities for return as a preferred investor
securities┃Projected timeline┃
2023/8/14
August14, 2023
1st acquisitionof the preferred
第1回優先
investment
securities
出資証券の取得

August 2023
Commencement ofdevelopment activities

2023/8/14
May2024 (scheduled)
2nd 第1回優先acquisition of the preferredinvestment securities
出資証券の取得

December 2024
(scheduled)Completion of thebuilding

Acquisition of
the building
20

Investment Status and Growth Strategy

External Growth – Continue to implement measures for external growth–
XYMAX REIT will continue to focus on asset type and consider acquisition of properties in accordance with the portfolio strategy.
We will continue our sourcing activities to determine the fundamental value of the target properties, with an awareness of the balance
between DPU growth and financial soundness.

┃ Unrealized gain by property owned by XYMAX REIT┃┃ Acquisition policy ┃At the end of 11th FP

 We intend to build new property pipelines by selecting prime properties
from the rich property information gained from the sponsor network andcarefully examining them at the Asset Management Company.
9th FP

10th FP

11th FP

Number of pieces of informationacquired from sponsor group

765

473

699

Number of properties underconsideration by XYMAX REIT

26

18

30

┃LTV┃At the end of 11th FP

 As for the return of unrealized gain on properties, which is one of
the XYMAX REIT characteristics, XYMAX REIT will consider the
return by asset replacements, etc. as one of the asset strategies.
OthersSendai140
1,112
Other retail （4,454yen）
430
Seiseki‐
Sakuragaoka
432（1,730yen）
RetailMuza
1,534（6,144yen）

LTV based on total assets: 40.9%, Appraisal LTV : 33.3%
LTV levelvs. total assets

Possible loan amount

Appraisal LTV

45%

Approx. 3.6 billion yen

37.2%

50%

Approx. 8.7 billion yen

41.9%┃ Properties under consideration ┃

Hotel

Other

Shinjuku‐Gyoen
2,159（8,648yen）

Total
unrealized gain
Iwamotocho

1,511
10,944 Office （6,052yen）

million yen

HachiojiKamiyacho
Other office987
459（3,953yen）
380
Higashi‐azabu（1,838yen） Nishi‐Shimbashi
398
903（1,594yen） Higashi‐Ueno (3,617yen)
494（1,978yen）(unit: million yen)
*The amounts in parentheses are
Unrealized gains per unit for each
property.

Location

Asset type

Source8 central wardsof Tokyo

Office(planned)

CRE client of the XYMAX
Group

Reconstruction needs of CRE clients
Located in favorable locations near train and subway stations, where high demand is expected from tenants

Hirakata, Osaka

Retail property(planned)

CRE client of the XYMAXGroup

A retail development project in a location that is highly desired by CRE clients for opening stores
Tenants are expected to include daily necessities selling tenants (P.20 for more details)Core regional
city

Hotel
(specialized in stay)Private fund managed by
the XYMAX Group

Located in a regional economic hub and also with a high level of tourism resources, there is solid demand for accommodation

Regional city

Retail property(leasehold land)

the XYMAX GroupTokyo economic
area

OfficeThe Asset Management
Company’s own route

Focused point

Leasehold land of retail property
Expected daily use type of business with steady sales
Located in work‐dwelling areas and favorable locations near train and subway stations, where high demand is expected fromtenants

21

Investment Status and Growth Strategy

Financial Status at the end of 11th FP
XYMAX REIT establishes a financial base that puts emphasis on stability and soundness in the financing,
mainly composed of megabanks and regional banks, etc., that have financial business relationships withthe sponsor group.
┃Interest‐bearing liabilities and the external rating┃ ┃Financing policy on refinancing in the 12th FP┃
at the end of 11th FP
Balance of interest‐bearing debts

19.71 billion yen

LTV based on total assets

40.9%

Average remaining period

2 years 4 months

Average interest rate

0.722％

Long‐term loan ratio

100.0%

Fixed interest rate ratio

99.0%

Consider a more flexible financing policy, while diversifying
financing methods in response to the interest rate trend at
the time of financing•

Remain open‐minded towards extension of the averageremaining period and diversification of the maturity ladder•

Consider adjustments of funding maturity and inclusion of avariable interest rate elements(from the viewpoint of cost control)•

R&I: Ａ– (Stable)

External rating┃ Lender formation ┃Number offinancial
institutions

15 companies

Challenge diversification of financing methods(investment corporation bonds, green loan, etc.)┃ Maturity ladder┃Mizuho Bank

23.4%

(million yen)

SMBC

18.5%

5,000

MUFG Bank

10.1%

Resona Bank

8.1%

Aozora Bank

7.1%

Nishi‐Nippon CB

5.1%

Fukuoka Bank

5.1%

Yokohama Bank

4.1%

Chiba Bank

3.9%

Hiroshima Bank

3.6%

SBI Shinsei Bank

3.4%

Nanto Bank

3.0%

Higo Bank

2.5%

Kansai Mirai Bank

1.6%

Mizuho Trust & Banking

0.5%

At the end of 11th FP

4,856
4,376

4,302

4,000

3,270
3,000

2,000

1,681
1,230

1,000

0

12th FP

13th FP

14th FP

15th FP

16th FP

17th FP

18th FP

19th FP

20th FP

21st FP

22nd FP

23rd FP

24th FP

22

Investment Status and Growth Strategy

Future Operating Policy

Unitholder value

Aiming to enhance unitholder value through thegrowth of distribution, etc.

Implementation of measuresfor external growth

Debt financing in line with themarket environment• Return of unrealized gain byasset replacements, etc.

Cost control by using
investment corporation bonds
or by including a variableinterest rate elements, etc.

Stable property management

Future operating
policy• Maintain high occupancy rates
for offices and retail facilities,
while adopting a market‐
conscious approach at tenant
replacement and contract
renewal• Expansion of the pipelines
aiming at enhancing asset size

• Recovery of hotel revenues

Operatingframework Utilization of the expertise, knowhow, and customer base of the sponsor group Deepening of ESG activities
 Broad‐based lender formation
23

ESG

ESG

Participation in External Certifications and Initiatives┃ Participation in the GRESB Assessment┃ Participated in the GRESB Assessment, yearly
benchmarks for environmental, social, andgovernance (ESG) performance in the real estate
sector since FY2022.
 Real estate assessment 2023: 3 Star and Green Star
for two consecutive years
 Disclosure assessment in 2023: “Level A” for two
consecutive years

Signing of Principles for Financial
Action for the 21st Century
 The Asset Management Company of XYMAXREIT, has endorsed the ideas of the Principles
and became a signatory on December 27,
2013.

┃ Support of the TCFD Recommendations┃ The Asset Management Company has
expressed its support for the TCFD
recommendations and has also joined the TCFD
Consortium, whose members consist ofJapanese companies that support the TCFD.

┃ Acquisition of Environmental Certification┃ (As of August 31, 2023)
 Newly acquired for one property and rose rate to 85.2%
 Acquired “Rank S” in the CASBEE real estate certification
for three properties
Number of Acquisitionof Environmental
Certification

11
properties

Acquisition rate(based on total floorarea)

85.2 %

Vita Seiseki‐Sakuragaoka

XYMAX Kiba Koen Building

Life Kawasaki Miyuki Store

Assessment Rank

Rank S(Excellent)

25

ESG

ESG Initiatives (1)Results of environmental initiatives┃Environmental targets┃ In FY2022, we achieved a reduction of GHG emissions intensity (Scope 1+2) by 78.0% and water use intensity (owner management area) by 18.4%,
compared with FY2018 (base year) Due to the high probability of achievement in FY2023 (target year), resetting of targets is under consideration, with an awareness of a more medium‐ tolong‐term approach, as well as newly formulated information disclosure based on TCFD recommendations┃Water use intensity (m3/m2)┃┃GHG emissions intensity(kg‐CO2/m2)┃
100
80

76.5

71.7

62.9

Adoption ofrenewable energy

60

1.46

1.50

1.39
1.04

0.70

0.68

FY 2018(base year)

FY 2019

0.90

16.8

20

1.80
1.20

35.2

40

0

72.6

0.60

0.49

1.77

1.26

0.39

1.44

0.57

0.66

FY 2022

FY 2023(target year)

0.30

FY 2018(base year)

FY 2019

FY 2020■Scope1+2

FY 2021

FY 2022

FY 2023(target year)

0.00

FY 2020

FY 2021

Owner management area

Tenant management area

Number of pages
reducedApproximately 85,000 pages(with respect to the 4th generalunitholders meeting)

Initiatives for Reducing Environmental Burden┃ Paperless processing┃ Paperless processing through electronic provision is underway for the notice of the generalunitholders meeting at XYMAX REIT.

┃ Adoption of electricity generated from 100% renewable energy sources┃ Adoption of electricity generated from 100% renewable energy sources Switching to 100% renewable energy sources using non‐fossil certificates with tracking
completed at 8 office properties┃Green Lease initiative┃ Aiming to improve the environmental performance of properties through a collaborative
effort with tenants, XYMAX REIT is promoting Green Leases

Targeted electricity
consumption

Number of tenants
covered by
Green Leases

1.66 million kWh(based on the 11th FP)

16 tenants(based on the 11th FP)

26

ESG

ESG Initiatives (2)Initiatives for Tenants and Local Communities┃ Resilience measures for disasters, etc. ┃ Introduction of emergency storageboxes
 Introduced disaster‐relief vending
machines

Initiatives of Asset Management Company┃ Initiatives to improve tenant satisfaction ┃ Introduction of digital signage in common area for 8 officeproperties in Tokyo (building electricity consumption, evacuationsites, and encouragement of power saving, etc., are posted) The PM company conducted a customer satisfaction survey over
the tenants at 9 office properties┃Qualification support system ┃┃Respect for diversity┃

 Asset Management Company introduced a system to provide incentives for employees
who acquire certain qualifications.
 Status of qualification (incl. those unregistered) by employees of Asset Management
Company (as of October 1, 2023)

 More than half of our executives and employees are female, and female
employees are succeeding in a wide range of fields, regardless of being in thefront, middle, or back office.

• Licensed Real Estate Broker• ARES Certified Master• Certified Building Administrator

24
7
6┃Flextime system and diversification of working places┃ Asset Management Company introduced a flextime system to support a more flexible
workstyle in line with the degree of activity.

Number of executives and employees(excluding dispatched employees)
MaleFemale(Percentage
of female)

Total

Maternity or
child care
leave

April 2021

15

19

55.9%

34

1

April 2022

14

19

57.6%

33

0

October 2023

17

17

50.0%

34

1

ESG initiatives at Sponsor Group Support for corporate workstyle reforms by offering satellite office services through such services  Serving as lecturer of ARES Real Estate Securitization Master training course
provided by ZXY Promoting diversification of working places and hours
 Contribution to the environment and the local communities through real estate management
services Participation in the United Nations Global Compact (UNGC)
 Nurturing real estate business personnel through Karakusa Fudosanjuku (real estate business Contribution to regional reinvigoration and revitalization through MEQQE
seminar ) at Sponsor Group Activities in organizations such as Japan Facility Management Association (JFMA) and Japan
Sustainable Building Consortium Contribution to ARES Real Estate Securitization Journal Accepting technical trainees from overseas
 Supporting for the development of young athletes

27

ESG

ESG Initiatives (3) XYMAX REIT adopts a decision‐making flow via committees
in which external committee members participate inmatters that significantly impact unitholders’ interests with
the intention of protecting unitholders’ interests.
 At the REIT Compliance Committee and REIT Investment
Committee, the attendance and approval of complianceofficers and external committee members are
requirements for resolutions. Accordingly, a governancesystem has been established to prevent arbitrary
management by the Asset Management Company.

Asset management fee system

Proposal by division(s) in charge

Examination by Compliance Officer
Disapprove

Matters other than the flow of the right, etc.

Matters for deliberation by REIT Compliance
Committee
Deliberation and resolution by REIT Compliance
Committee(vote in favor requires attendance and assent of external
committee members and Compliance Officer)

Vote
down

Set as agenda of REIT Investment Committee

ReturnDecision‐making Flow at AssetManagement Company

Fees for a fiscal period
Total asset‐linked Fee

Total assets × 0.2% per annum

Deliberation and resolution by REIT Investment Committee(Attendance and approval by external committee members and Compliance Officer are imperative for approval)

NOI × 4.0% per annum

NOI linked Fee

Vote
down

Acquisition and disposition fees
Acquisition Fee

Acquisition price × 1.0%*1

Disposition Fee

Gain on dispositions at the end of each period (after
deduction of loss on dispositions) × 15.0% *2

Matters other than the flow of the right, etc.

Related‐party transactions
Establishment of management guidelines
Issuance of investment units of above a certain
amountOther changes in important matters

Report to Board of Directors

Deliberation and resolution by Board of Directors*1 0.5%, in the case of acquisition from interested parties*2 0 yen, if the gains on disposition amount is negative

Investment Ratio in
XYMAX REIT by Sponsor

5.0%(at the end of 11th FP)

Vote
down

Along with the above, related‐party transactions, establishment of management guidelines, issuance ofinvestment units of or above a certain amount and other changes in important matters shall be subject to theapproval of XYMAX REIT’s Board of Directors prior to the transaction, and other matters shall be reported to
XYMAX REIT’s Board of Directors.

28

APPENDIXAPPENDIX

Characteristics of XYMAX REITXYMAX REIT realize the full potential of owned properties and maximize the unitholders’ value through relevant portfolio management
utilizing expertise and know‐how accumulated in and by the XYMAX Group, the sponsor.

Characteristics of XYMAX Group Japan’s prominent real estate management record
 Real estate management record: 1,126buildings/Gross floor area Approx. 6.20 million tsubo (as of July 31, 2023)
 Entrustment records by J‐REIT investment corporation other than XYMAX REIT: 33 companies/221 properties (as of July 31, 2023)
 Human resources: 2,357 people engaged in real estate management, 54 people in leasing, and 66 people in CRE related business (as of
October 1, 2023)
 Real estate management utilizing accumulated various data & development of new businesses applying expertise and know‐how Data of Real Estate Management: Contracted rent data 41,718 buildings/142,373 cases (accumulated total as of March 31, 2023),
Asking rent data 59,151 buildings (accumulated total as of March 31, 2023)/19,254 cases (as of March 31, 2023), Construction work
data 173,316 cases (accumulated total as of February 28, 2023)
 Membership satellite office business ZXY and expanding own hotel brand, karaksa hotels.

 Track record in real estate sales and brokerage utilizing huge customer base
 Relationship with real estate owners: approximately 450 companies (as of July 31, 2023)
 Track record in property sales and brokerage: 388 buildings, approximately 610.8 billion yen(accumulated total from April 1, 2010 to March 31, 2023)

Utilizing XYMAX Group’s expertise and know‐how as “3 Strength”

Assessment

Management

Sourcing
30

APPENDIX

The source of power to maximize unitholder value; XYMAX REIT’s “3 strengths”
XYMAX REIT will maximize unitholder value by utilizing the three real estate management strengths of its sponsor, the
XYMAX Group.

“3 strengths” of XYMAX REIT

Assessment

 Through combining our knowledge gained through real estate management experiencethroughout Japan and an analysis of a huge amount of unique real estate data held by thesponsor group, we will accurately determine the market positioning of a target property,
upon estimating the appropriate level of rent and management costs for such property.

Management

 Through daily unfettered discussion, we will perform management which directly utilizes
various expertise of the sponsor group as well as input from the frontline. With close
communication with the frontline enabling quick decisions, we will maximize property
potentials, together with ensuring opportunities for internal growth.
 Utilizing the sponsor group’s direct communication with real estate owners, we will seize
property acquisition opportunities in exclusive transactions for sure.

Sourcing

 Utilizing the real estate buying and selling needs of the customer base of the CRE service
provided by the sponsor group, we will create property acquisition opportunities in
exclusive transactions.
31

APPENDIX

Balance Sheet(Unit: thousand yen)

10th fiscal period(As of Feb. 28, 2023)(Unit: thousand yen)

10th fiscal period(As of Feb. 28, 2023)

11th fiscal period(As of Aug. 31, 2023)

11th fiscal period(As of Aug. 31, 2023)

Liabilities

AssetsCurrent liabilities

Current assets
Cash and bank deposits

1,387,993

1,251,963

Operating accounts payable

Cash and bank deposits in trust

2,474,091

2,537,366

Current portion of long‐term borrowings

Operating accounts receivable

31,29338,436

Accounts payable ‐ otherPrepaid expenses

48,911

50,679

Income taxes payable

Other

1,496

810

3,943,785

3,879,257

Total current assets
Non‐current assets

940
40,835

Advances received

238,201

247,897

1,633

4,722

4,974,180

4,895,216

15,339,000

15,339,000

33,34933,3491,713,997

1,729,418

270

2,091

17,086,617

17,103,859

22,060,798

21,999,075

25,440,013

25,440,013‐2,995‐249

Total current liabilities
296,547

Structures

1,699

1,665

Long‐term loans payable

Machinery and equipment

9,984

9,782

Tenant leasehold and security deposits

Tools, furniture and fixtures

11,751

8,748

Tenant leasehold and security deposits in trustLand

230,346

230,346

Buildings in trust

9,912,281

9,871,828

Structures in trust

52,19550,9960025,057

21,70933,661,874

33,661,874

104

154

44,205,397

44,153,654‐

28,996

61,15745,65410

16

Lease and guarantee deposits

22,60022,600Other

64,014

83,895

Total investments and other assets

147,783

181,163

Land in trust
Construction in progress in trust
Total property, plant and equipment
Investments and other assets
Investment Securities
Long‐term prepaid expenses
Deferred tax assets

Total non‐current assets

44,334,817

Total deferred assets
Total assets

Derivatives liabilities
Total non‐current liabilities
Total liabilities
Net assets
Unitholders’ equity
Unitholders’ capital
Deduction from unitholders’ capital
Allowance for temporary difference adjustments‐2,995‐249

25,437,017

25,439,763

Unappropriated retained earnings (undisposed loss)

817,416

790,823

Total surplus

817,416

790,823

26,254,434

26,230,587‐270‐2,091

Unitholders’ capital, net
Surplus

Total unitholders’ equity
Valuation and translation adjustments
Deferred gains or losses on hedges

Deferred assets
Investment unit issuance costs

Non‐current liabilities

Total deduction from unitholders’ capital

44,353,180
17,995

13,49617,995

13,49648,314,961

48,227,571

124,195

822

300,100

Tools, furniture and fixtures in trust

121,245
92,151

Buildings

Machinery and equipment in trust

100,624
4,376,000

Accrued consumption taxes
Other

Property, plant and equipment

144,126
4,376,000‐270‐2,091

Total net assets

Total valuation and translation adjustments

26,254,163

26,228,495

Total liabilities and net assets

48,314,961

48,227,571

32

APPENDIX

Statement of Income(Unit: thousand yen)

10th fiscal period(As of Feb. 28, 2023)

11th fiscal period(As of Aug. 31, 2023)

Operating revenue
Leasing business revenue

1,497,162

1,517,636

148,853

147,425

1,646,016

1,665,062

Expenses related to leasing business

584,571621,274

Other leasing business revenue
Total operating revenue
Operating expenses
Asset management fees

97,09397,082

Asset custody fees

1,275

1,267

Administrative service fees

14,497

14,554

Directors’ compensations

2,400

2,400

Other operating expenses

37,37245,753

Total operating expenses

737,209782,332

908,806

882,729

Interest income

1918Interest on refund

286‐

Compensation received(Water charge refund)

‐

2,125

Gain on forfeiture of unclaimed distributions

175

40

Operating income
Non‐operating income

Other

12

‐

Total non‐operating income

493

2,184

Interest expenses

63,741

71,729Borrowing related expenses

23,194

17,236

Amortization of investment unit issuance costs

4,498

4,498

Other

2,789

‐

Total non‐operating expenses

94,224

93,465

Ordinary income

815,075

791,448

Income before income taxes

815,075

791,448

Income taxes ‐ current

825

942

Income taxes ‐ deferred

4

‐5

830

937

814,245

790,511

3,171

312

817,416

790,823

Non‐operating expenses

Total income taxes
Net income
Retained earnings brought forward
Unappropriated retained earnings (undisposed loss)

33

APPENDIX

Portfolio List (1)Asset no.

OF‐01

OF‐02

OF‐03

OF‐04

OF‐05

OF‐06

Asset type

OfficeOfficeOfficeOfficeOfficeOfficeProperty nameXYMAX Nishi‐Shimbashi
Building

XYMAX Iwamotocho Building

XYMAX Shinjuku‐Gyoen
Building

XYMAX Kamiyacho Building

XYMAX Higashi‐Azabu Building

XYMAX Higashi‐Ueno Building

Location

Minato‐ku, Tokyo

Chiyoda‐ku, Tokyo

Shinjuku‐ku, Tokyo

Minato‐ku, Tokyo

Minato‐ku, Tokyo

Taito‐ku, Tokyo

3 minutes on foot from
Iwamoto‐cho Station on the
Toei Subway Shinjuku Line

2 minutes on foot from
Shinjuku Gyoenmae Station on
the Tokyo Metro MarunouchiLine

1 minute on foot from
Kamiyacho Station on theTokyo Metro Hibiya Line

5 minutes on foot from
Akabanebashi Station on the
Toei Subway Oedo Line

3 minutes on foot from Naka‐
Okachimachi Station Tokyo
Metro Hibiya Line

7 minutes on foot from
Kamiyacho Station on theTokyo Metro Hibiya Line

4 minutes on foot from JR
Okachimachi Station, andother

3 minutes on foot from
Uchisaiwaicho Station on the
Toei Subway Mita Line
Access6 minutes on foot from
Shimbashi Station on the JRTokyo Metro Ginza Line, andother

Acquisition price(million yen)

2,500

4,250

5,020

880

1,550

1,150

Land area

402.53㎡

864.83㎡

839.09㎡

228.83㎡

365.05㎡

368.84㎡

Total floor area

2,517.50㎡

6,261.06㎡

6,084.32㎡

1,356.51㎡

2,570.13㎡

1,942.54㎡

Leasable area

1,897.92㎡

4,152.40㎡

4,791.23㎡

1,205.27㎡

2,015.99㎡

1,735.29㎡

Completion

2000

2001

2001

1991

1999

1999

Structure/Number of
FloorsReinforced concrete
structure with flat roof 9F

Steel‐framed reinforced
concrete structure with flat
roof B1F/9F

Steel‐construction /Reinforced concrete structurewith flat roof B1F/9F

Steel‐construction with flat
roof 8F

Steel‐framed reinforced
concrete structure with flat
roof B1F/9F

Steel‐framed reinforced
concrete structure with flat
roof 8F

Number of tenant(As of the end of 11th FP)

8

14

5

7

6

8

Occupancy rate
(As of the end of 11th FP)

100.0%

100.0%

98.5%

100.0%

100.0%

100.0%

34

APPENDIX

Portfolio List (2)Asset no.

OF‐07

OF-08

OF-09

OF-10

RT-01

RT-02

Asset type

OfficeOfficeOfficeOfficeRetailRetailProperty nameXYMAX Hachioji Building

XYMAX MitaBuilding

XYMAX Sapporo Odori Building

XYMAX Kiba koen Building

Muza Kawasaki

Life Kawasaki Miyuki Store

Location

Hachioji‐shi, Tokyo

Minato‐ku, Tokyo

Sapporo‐shi, Hokkaido

Koto‐ku, Tokyo

Kawasaki‐shi, Kanagawa

Kawasaki‐shi, Kanagawa

Access4 minutes on foot from Keio
Hachioji Station on the Keio
Electric Railway Keio Line

5 minutes on foot from
Mita Station on the Toei
Subway Mita Line, and other5 minutes on foot from JR
Hachioji Station

1 minute on foot from Kiba
Station on the Tokyo Metro
Tozai Line

JR Kawasaki Station
Directly Connected

7 minutes on foot fromJR Tamachi Station

1 minute on foot from Odori
Station on the Sapporo City
Subway, Namboku Line, Tozai
Line, and Touhou Line

15 minutes on foot from JR
Kashimada Station and Yako
StationAcquisition price(million yen)

2,600

668

4,707

2,003

4,100

790

Land area

1,220.58㎡

137.02㎡

499.24㎡

851.46㎡

10,669.34㎡ *1

1,879.15㎡

Total floor area

7,404.81㎡

799.78㎡

4,270.89㎡

2,995.81㎡

108,955.90㎡ *1

2,596.80㎡

Leasable area

5,558.87㎡

741.41㎡

3,106.42㎡

2,587.15㎡

3,703.88㎡

2,677.54㎡

Completion

1993

1991

2020

1992

2003

1997

Structure/Number of
FloorsSteel‐framed reinforced
concrete/ Steel‐construction
with flat roof B1F/9F

Steel‐construction with flat
roof 10F

Steel‐construction with flat
roof B1F/10F

Reinforced concrete structurewith flat roof 6F

Steel‐framed/Steel‐framed
reinforced concrete structurewith flat roof/stainless steel
plate roofing B2F/27F

Steel‐construction with flat
roof 2F

Number of tenant(As of the end of 11th FP)

22

7

6

7

19

1

Occupancy rate
(As of the end of 11th FP)

98.4%

79.4%

100.0%

100.0%

100.0%

100.0%*1: Both land area and total floor area above represent land area and total floor area of one building, respectively.

35

APPENDIX

Portfolio List (3)Asset no.

RT-03

RT-04

RT-05

RT-06

HT-01

OT-02

Asset type

RetailRetailRetailRetailHotel

Other (Residential)

Property name

Vita Seiseki‐Sakuragaoka

Life Fukuizumi StoreThe Park House Totsuka Front(the Retail Portions of 1st and2nd Floors)

Valor Kachigawa Store(Leasehold land)

Hotel Vista Sendai

L‐Place Nishikasai

Location

Tama‐shi, Tokyo

Sakai‐shi, Osaka

Yokohama‐shi, Kanagawa

Kasugai‐shi, Aichi

Sendai‐shi, Miyagi

Edogawa‐ku, Tokyo

AccessKeio Electric Railway Keio Line
Seiseki Sakuragaoka Station
Directly Connected

12 minutes on foot from Otori
Station on the JR Hanwa Line

3 minutes on foot from
JR and Yokohama shiei Subway
Blue Line Totsuka Station

7 minutes on foot from
Kachigawa Station on the JR
Chuo Main Line

Acquisition price(million yen)

3,100

1,065

540

3,245

4,400

901

Land area

9,003.26㎡ *1

6,225.21㎡

1,595.49㎡ *1

20,509.10㎡*1

1,461.36㎡ *3

854.00㎡

Total floor area

62,849.56㎡ *1

3,358.26㎡

12,236.50㎡ *1‐

6,977.47㎡

2,044.18㎡

Leasable area

27,610.61㎡

3,309.29㎡

861.60㎡

10,254.55㎡*2

7,066.25㎡

2,044.18㎡

Completion

1999

1996

2018

‐

2016

1986

Structure/Number of
FloorsSteel‐framed reinforced
concrete structure/reinforced
concrete structure/steel‐construction withflat roof B3F/27F

Steel‐construction with flat
roof 2F

Reinforced concrete structurewith flat roof B1F/14F‐

Steel‐construction with flat
roof 12F

Reinforced concrete structurewith flat roof 5F

Number of tenant(As of the end of 11th FP)

1

1

5

1

1

1

Occupancy rate
(As of the end of 11th FP)

100.0%

100.0%

100.0％

100.0％

100.0%

100.0%

4 minutes on foot from JR
Sendai Station
1 minute on foot from
Miyagino Dori Station on the
Sendai City Subway Tozai Line

*1: Both land area and total floor area above represent land area and total floor area of one building, respectively.
*2: The figures are calculated by multiplying the leased floor area under the lease contract by the quasi co‐ownership ratio of the beneficiary rights held by the XYMAX REIT (50%).
*3: 1,461.36 m2 includes surface rights of 524.21 m2.

5 minutes on foot from
Nishikasai Station on the Tokyo
Metro Tozai Line36

APPENDIX

Portfolio Map┃ Country wide area┃┃ 23 wards of Tokyo ┃37

APPENDIX

Characteristic of Current Office Tenants and the Trends of Occupancy Rate
Backed by the sponsor group’s management capabilities, we have achieved stable, long‐term occupancy by office tenants.
┃ Office tenant diversification <based on rent revenue> (excluding obligated residences) (81 office tenants) ┃At the end of 11th FP
Based on business type

Leased area based top tenants ratio
Wholesale27.23％

Other service

25.06％

Manufacturing

18.96％

IT

9.93％

Real estate

4.54％

Medical and Welfare

4.44％

2.08％

Construction business

2.06％

Retail

1.06％

Restaurants

0.74％

Top 1011.08%

11th - 30th

All tenants: 11 years, 9 months

31st - 50th

15.77%

Top ten tenants by leased area:
13 years, 5 months

51st -

47.78%

Lawyers and Accountants 3.90％
Bank

Average tenant lease period of
offices owned by XYMAX REIT

Average tenant lease period
of office buildings

25.37％

9.6 years*1*1

Source: “Analysis of Lease Periods of Office Tenants in the 23 Wards ofTokyo (2018)” by XYMAX Real Estate Institute┃ Average Occupancy Rate of office (including obligated residences )┃
100%

99.5%
99.2%

98%

96.6%
97.7%

96.1%

98.9%

98.3%

98.3%
96.7%

97.6%

98.1%
98.7%

97.5%

96.5%

2008/02

2009/02

2010/02

98.9％

96.0%

96.3％

93.1%

93.0%

Occupancy rate of office properties owned by XYMAX REIT

91.6%

Average occupancy rate of J‐REIT offices

Financial Crisis

88%

98.9%

96.8%

IPO

94.6%

The Global

98.6%

99.0%

97.6%

95.3%

94%

90%

98.8%

95.9%

95.8%

92%

100.0%

97.9%

96.6%

96%

99.1%

2011/02

2012/022013/02

2014/02

2015/02

2016/022017/022018/02

2019/022020/022021/022022/022023/022023/07

38

APPENDIX

Operating Income (Loss) from Real Estate Leasing by Asset(1/2)(Unit: thousand yen)

Nishi‐
Shimbashi

Iwamotocho

Shinjuku‐
Gyoen

Kamiyacho

Operating revenue
from real estate leasing

87,291

147,541

190,573

44,70557,67649,975

136,982

17,611

137,310

60,242

Lease business revenue

76,160127,089

174,344

39,21150,39043,583

113,423

13,562

124,558

52,322Other lease businessrevenue

11,131

20,451

16,228

5,493

7,285

6,392

23,5584,048

12,751

7,919

25,791

40,76659,16016,617

20,231

16,004

48,171

11,28728,35018,556

Tax and public dues

7,674

14,26815,423

5,089

7,011

4,024

8,381

1,392

8,093

4,111

Maintenance fees

5,500

10,567

12,597

4,742

5,918

4,391

16,389

2,880

7,761

6,834

Utility expenses

9,561

12,586

12,998

5,028

4,398

6,183

13,992

1,101

9,795

5,275

Repair expenses

2,080

1,497

15,944

856

2,031

719

7,248

3,857

25

1,674

Insurance premiums

60

217

208

45

80

59

270

36

303

110

Other expenses related
to leasing business

913

1,628

1,987

855

791

626

1,888

2,018

2,371

549

NOI

61,499106,774

131,41328,08737,44533,971

88,8106,324

108,959

41,686

Depreciation

3,169

17,565

15,223

1,556

7,046

3,529

11,493

1,487

22,736

5,527

Operating income (loss)
from real estate leasing

58,33089,208116,189

26,53130,39930,441

77,317

4,836

86,22236,159Operating expenses
from real estate leasing(Excluding Depreciation)

Higashi‐
Azabu

Higashi‐
Ueno

Hachioji

Sapporo

Mita

Kiba

39

APPENDIX

Operating Income (Loss) from Real Estate Leasing by Asset(2/2)(Unit: thousand yen)

Muza

Kawasaki
MiyukiSeiseki‐
Sakuragaoka

Fukuizumi

Operating revenue
from real estate leasing

182,035

undisclosed

undisclosed

undisclosed

Lease business revenue

157,033

undisclosed

undisclosed

Other lease businessrevenue

25,001

undisclosed

53,488Tax and public dues

Kachigawa

Sendai

Nishikasai

Total

26,813undisclosed

undisclosed

undisclosed

1,665,062

undisclosed

23,214

undisclosed

undisclosed

undisclosed

1,517,636

undisclosed

undisclosed

3,598

undisclosed

undisclosed

undisclosed

147,425

undisclosed

undisclosed

undisclosed

10,836undisclosed

undisclosed

undisclosed

453,097

11,492undisclosed

undisclosed

undisclosed

1,838

undisclosed

undisclosed

undisclosed

154,082

Maintenance fees

15,018undisclosed

undisclosed

undisclosed

5,078

undisclosed

undisclosed

undisclosed

110,049

Utility expenses

21,217undisclosed

undisclosed

undisclosed

3,726

undisclosed

undisclosed

undisclosed

106,749

Repair expenses

4,737

undisclosed

undisclosed

undisclosed

99

undisclosed

undisclosed

undisclosed

55,483

Insurance premiums

187

undisclosed

undisclosed

undisclosed

51

undisclosed

undisclosed

undisclosed

3,819

Other expenses related
to leasing business

835

undisclosed

undisclosed

undisclosed

41

undisclosed

undisclosed

undisclosed

23,152

128,546

22,715

163,432

25,776

15,976

65,690119,959

24,892

1,211,965

Depreciation

18,028

1,669

29,226

2,223

3,790

‐

21,432

2,471

168,177

Operating income (loss)
from real estate leasing

110,518

21,045

134,206

23,553

12,186

65,69098,25722,4201,043,787

Operating expenses
from real estate leasing(Excluding Depreciation)

NOI

Totsuka

40

APPENDIX

Overview of Appraisal Report
Asset
no

Asset nameAcquisitiondate

Acquisition price Book value as ofthe end of 11th FP(million yen)(million yen)

End of 10th FP(February 28, 2023)

End of 11th FP(August 31, 2023)

ChangeCapitalization rate
Capitalization rate
based on direct
Appraisal
based on direct
Appraisal
capitalization
value (million yen) capitalization
value (million yen)method (%)
method (%)

Capitalization rate
based on direct
capitalization
method *2 (%)

Appraisalvalue *1
(million yen)Appraiser

Unrealized profit
or loss *3(million yen)

OF-01

XYMAX Nishi‐Shimbashi Building

February 2018

2,500

2,516

3,340

3.3

3,420

3.2

80

‐0.1 Appraisal Co., Ltd.

The Tanizawa Sōgō

903

OF-02

XYMAX Iwamotocho Building

February 2018

4,250

4,388

5,930

3.3

5,900

3.3

‐30

‐ InstituteJapan Real Estate

1,511Japan Real Estate
Institute

2,159

OF-03

XYMAX Shinjuku‐Gyoen Building

February 2018

5,020

5,130

7,330

3.3

7,290

3.3

‐40

OF-04

XYMAX Kamiyacho Building

February 2018

880

890

1,320

3.4

1,350

3.3

30

‐0.1 Appraisal Co., Ltd.

The Tanizawa Sōgō

459

OF-05

XYMAX Higashi‐Azabu Building

February 2018

1,550

1,601

1,990

3.8

2,000

3.8

10

‐ Appraisal Co., Ltd.

Daiwa Real Estate

398

OF-06

XYMAX Higashi‐Ueno Building

February 2018

1,150

1,165

1,660

3.9

1,660

3.9

‐

‐ Appraisal Co., Ltd.

Daiwa Real Estate

494

OF-07

XYMAX Hachioji Building

February 2018

2,600

2,642

3,650

4.6

3,630

4.6

‐20

‐ InstituteJapan Real Estate

987

OF-08

XYMAX Mita Building

July 2021

668

689

759

3.7

748

3.7

‐11

‐ InstituteJapan Real Estate

58

OF-09

XYMAX Sapporo Odori Building

March 2022

4,707

4,711

4,970

3.8

4,980

3.7

10

‐0.1 InstituteJapan Real Estate

268

OF-10

XYMAX Kiba koen Building

March 2022

2,003

2,096

2,150

4.3

2,150

4.3

‐

‐ InstituteJapan Real Estate

53

RT-01

Muza Kawasaki

February 2018

4,100

4,015

5,550

4.1

5,550

4.1

‐

‐ Appraisal Co., Ltd.

The Tanizawa Sōgō

1,534

RT-02

Life Kawasaki Miyuki Store

February 2018

790

789

971

4.2

971

4.2

‐

‐ Appraisal Co., Ltd.

Daiwa Real Estate

181

RT-03

Vita Seiseki‐Sakuragaoka

February 2018

3,100

3,507

3,940

5.0

3,940

5.0

‐

‐ Appraisal Co., Ltd.

The Tanizawa Sōgō

432

RT-04

Life Fukuizumi Store

September 2020

1,065

1,072

1,090

4.5

1,090

4.5

‐

‐ Appraisal Co., Ltd.

Daiwa Real Estate

17

RT-05

The Park House Totsuka Front (the RetailPortions of 1st and 2nd Floors)

July 2021

540

538

633

4.5

649

4.5

16

‐ Appraisal Co., Ltd.

The Tanizawa Sōgō

110

The Tanizawa Sōgō
Appraisal Co., Ltd.

120

RT-06

‐

January 2022

3,245

3,289

3,410

‐

3,410

‐

‐

HT-01 Hotel Vista Sendai

February 2018

4,400

4,177

5,180

4.7

5,290

4.6

110

‐0.1 Appraisal Co., Ltd.

The Tanizawa Sōgō

1,112

OT-02 L‐Place Nishikasai

March 2022

901

929

1,040

4.4

1,070

4.3

30

Tanizawa Sōgō
‐0.1 The
Appraisal Co., Ltd.

140

43,46944,15354,913‐55,098‐185

Valor Kachigawa Store (Leasehold land)

Total / Average‐‐

10,944*1: The difference between the estimated value at the end of the 10th FP and the estimated value at the end of the 11th FP is indicated.
*2: The difference between the direct capitalization rate adopted in the real estate appraisal report for each portfolio asset in the calculation of estimated value at the end of the 10th FP and the direct capitalization rate adopted in the real estate report for each portfolio asset in the calculation of estimated value at the end of the 11th FP is indicated.
*3: The difference between the estimated value at the end of the 11th FP and the book value at the end of the 11th FP is indicated.

41

APPENDIX

Change in Investment Unit Price┃ Change in investment unit price ┃ As of September 29, 2023
（yen） 150,000

Tokyo Stock Exchange REIT Index

XYR

PO発⾏価格113,024円Closing price 115,700 yen

140,000

As of September 29, 2023
130,000

120,000

110,000

100,000

90,00080,00070,000

4/1
2021
4/1

5/1

6/1

7/1

8/1

9/1

10/1

11/1

12/1

1/1
2022
1/1

2/1

3/1

4/1

5/1

6/1

7/1

8/1

9/1

10/1

11/1

12/1

1/1
2023
1/1

2/1

3/1

4/1

* The starting point of investment unit price is set on April 1, 2021, and the Tokyo Stock Exchange REIT Index is indexed based on the opening price as of April 1, 2021.

5/1

6/1

7/1

8/1

9/1

42

APPENDIX

Status of Unitholders
Share of investment units by owner type

Major unitholders■Individuals, other ■Financial institutions ■Other domestic companies■Overseas institutions, etc. ■Securities companies

Name

9.6%

39.2%

31.2%

9th FP

15.3%

10.4%

41.1%

30.4%

8th FP

14.4%

2.8%

30.7%

45.1%

9.8%

11.6%

2.9%

11th FP

31.5%

44.9%

10.0%

10.5%

3.2%

8th FP

9th FP

10th FP

11th FP

Individuals, other

8,214

9,681

9,916

10,306

Financial institutions

33

34

34

33

162

184

193

193

Number ofinvestment units(unit)

Ratio*(%)

Custody Bank of Japan, Ltd. (Trust account)

48,52519.43%The Master Trust Bank of Japan, Ltd. (Trustaccount)

35,602

14.26%XYMAX Corporation

12,500

5.00%

The Nomura Trust and Banking Co., Ltd.
(Investment Trust Account)

10,545

4.22%

BNP‐PARIBAS FRANKFURT/2S/JASDEC/GERMANRESIDENTS‐AIFM

4,721

1.89%

SCBHK AC LIECHTENSTEINISCHE LANDESBANK AG

3,925

1.57%

JDC CORPORATION

3,000

1.20%

Mitsubishi UFJ Morgan Stanley Securities Co., Ltd.

2,925

1.17%

2,829

1.13%

5.6%

10th FP

Number of unitholders by owner type

(At the end of 11th FP)

Other domestic
companies
Overseas institutions,
etc.

110

110

129

124

BNYM SA/NV FOR BNYM FOR BNY GCM CLIENT
ACCOUNTS M LSCB RD

Securities companies

24

23

19

19

Osaka Shoko Shinkin Bank

2,526

1.01%

Total

8,543

10,032

10,291

10,675

Total

127,098

50.91%* The ratio of unitholders is rounded down to the second decimal place.

43

APPENDIX

Overview of Asset Management Company
Overview
Company nameLocation

Organization
XYMAX REAL ESTATE INVESTMENT ADVISORS Corporation
XYMAX Akasaka 111 Building, 1‐1‐1 Akasaka, Minato‐ku, Tokyo

Establishment

August 6, 2007

Capital

0.2 billion yen

Major shareholders
Number of
employees

Lines of business

Executives

GeneralUnitholders’Meeting
AuditorBoard of Directors

XYMAX Corporation (100% )ESG Promotion
Committee

34 (as of October 1, 2023) including directors(1) Financial instruments business as prescribed in the Financial
Instruments and Exchange Act(2) Real estate investment advisory business and discretionary realestate investment business(3) Asset management business for investment corporation
Hideki Fukae, Representative Director and President
Yasushi Yamaguchi, Director
Kazuya Sugimoto, Director
Akimitsu Takagi, Auditor

Compliance
Committee

REIT Compliance
Committee

Investment
Committee

REIT Investment
Committee

Internal Audit Team

Compliance OfficeCompliance Officer
Representative
Director

Financial instruments business: Director‐General of the Kanto Local Finance Bureau
Registration (FIBO) No. 1907 (Investment Management Business, Investment Advisory
and Agency Business, and Type II Financial Instruments Business)

Licenses

Discretionary transaction agency, etc. business: Minister of Land, Infrastructure,
Transport and Tourism Approval No. 118
Real Estate Specified Joint Enterprise: License No. 75 granted by Commissioner of the
Financial Services Agency and Minister of Land, Infrastructure, Transport and Tourism(for businesses referred to in items (iii) and (iv))
Real estate investment advisory business: Registration No. Sogo‐57
Real estate brokerage business: Governor of Tokyo License (4) No. 88223

Private Investment
Management
Department

Business
Administration
Division

REIT
Management
Department

44

APPENDIX

Overview of XYMAX Group
Company
nameOfficeXYMAX Corporation (unlisted)

Retail/Store

Logistics

Hotel

Establishm
ent

Location of
headquartersCapital

Sales

March 1, 1990
* Spin‐off from Recruit Co., Ltd. through employee

participatory MBO in 2000

1‐1‐1 Akasaka, Minato‐ku, Tokyo

3,321,365,000 yen

109,049 million yen(actual results for the fiscal year ended
March 2023)

Real estate consulting andmanagement services

Real estate consulting* Consolidated figures of the Group

Asset Management

XYMAX
XYMAX TRUSTXYMAX REAL ESTATE INVESTMENT ADVISORS/MAX‐REALTY

Asset management
Asset strategy, etc.

Valormax

Real estate
management
Property management
Building maintenanceIntegrated
management of
store facilities

Representative Director, Chairman & CEO:
Masafumi Shimada
Representative Director Kenji Yoshimoto

Major
shareholders

XYMAX Shareholding Association, directors& employees, clients and financial
institutions
Total: 351 (as of March 31, 2023)

Number of
employees

7,164 (as of April 1, 2023)

Other specialized
services

Facility management

Representa
tive* Consolidated figures of the GroupCRE strategy, effective
utilization,
development/design
Consulting and planning on
inheritance, fund procurement,
etc.
Real estate appraisal, realestate evaluation and research

SG Asset Max

Hokkaido

XYMAX HOKKAIDO

East Japan

XYMAX

Tokai

XYMAX TOKAI

KansaiXYMAX KANSAI

KyushuXYMAX KYUSHU

Leasing brokerage

Market survey/analysis
Research/planning on
management and repair

Hotel business

Linen Supply & Cleaning

XYMAX INFONISTAXYMAX REAL ESTATE
INSTITUTE

KARAKSA HOTELSXYMAX careSS
Corporation

Cleaning

Security

Satellite office

Risk management

XYMAX SALAMAX SECURITY SERVICEXYMAX ZXY Department

Safety Organization for
Urban Renewal

Realize growth of XYMAX REIT by drawing on all of
the XYMAX Group’s expertise and workforce

45

APPENDIX

Corporate History
Started Office Property Management Business
1982:

1996:

2000:

Started the services such planning, development,
management for the Recruit Group’s own officebuilding investment and utilization after thecreation of the “Buildings‐related Division” of
Recruit Group.

Made a Full‐scale Entry to Retail Property Management BusinessStarted to provide the property management
service to corporate and private owners otherthan Recruit Group.

2001:

Establishment of Retail Property Management Business Division of XYMAX

MBO from Recruit Group which gave birth to
XYMAX Group

Entry into Hotel‐related Business2012:

Acquired 100% stake of Abilitas Hospitality Co., Ltd.

Started Asset Management Business
2007:

2000

2001

Started to provide hybrid
service of real estate andfinance by setting up MAX‐REALTY, a joint venture with
Sumitomo Mitsui Banking
Corporation.

2002

2003

2004

Made an entry into thebuilding management (BM)service by setting up XACUTechno Service Corporation, ajoint venture with Haseko
Anesis2005

Set up XYMAX Real Estate Investment Advisors Corporation

2006

2007

Enhanced the BM business byacquiring 100% stake of Asahi
Building Management
Services, Inc., a subsidiary of
the Daiei Inc.

2008

2009

2010

Entered into a business tie‐up
with SG Holdings Co., Ltd., aholding company of Sagawa
Express Co., Ltd.

2011

2012

2013

Started the private REIT
business through SG Asset
Max Co., Ltd., a joint venturewith SG Realty Co., LTD.

2014

2015

2016

Opened karaksa hotel Osaka
Shinsaibashi I and karaksa
hotel Kyoto I.

2017

2018

Made an entry into
the J‐REIT business46

APPENDIX

Fertile Management Base of the XYMAX GroupThe XYMAX Group has been ranked as No. 1 domestic service provider in the PM business in terms of contracting recordof real estate management projects for six years in a row since 2010*.
■ Human resources: 2,357 people engaged in real estate management, 54 in leasing, and 66 in CRE related business(as of October 1, 2023)■ Relationship with real estate owners: approximately 450 companies (as of the end of July 2023)■ Track record in property sales and brokerage: 388 buildings, approximately 610.8 billion yen(accumulated total from April 1, 2010, to March 31, 2023)

Hokkaido Region
45┃ Real estate management record (As of the end of July 2023) ┃Actual number ofcontracts
1,126 buildings

Hokkaido ∙Tohoku Region

Gross floor area
Approx. 6.2 million tsubo

500(Approx. 21.0 million m2)

Central ∙ Koushin’etsu
Region┃ Facility management record (As of the end of June 2023) ┃Actual number ofcontracts

Number of customers
119 companies
Approx. 8,700 storesTohoku Region
14

1,000

Central ∙Kanto Region
Chugoku ∙Koushin’etsu Region
3,800
Kanto Region
Shikoku Region
Kansai Region 80
637
Chugoku ∙400
Shikoku Region 250
12

Kyushu ∙Kyushu Region
Okinawa Region
79

Kansai Region

Okinawa Region

2,100

9

900

* According to each November issue of the monthly magazine Property Management from 2010 to 2015, the XYMAX Group was ranked No. 1 in terms of floor area under management for six

consecutive years since 2010.

47

Cooperation with ITBM Center

Statutory inspections, confirmation of items pointed
out/Proposing correction

Asset Value
Maintenance

Building maintenance and management(cleaning/security/maintenance)

Optimization of management specifications

Confirming of completion of repair
work/Arranging payments

Accounting
ReportArranging contractors/Obtaining
estimates/Assessing amounts

Leasing Related
Operations

Checking /Reporting on status of items
requiring repair

XYMAX Group

Repair planning

Report/Proposal

Preparation and submission of annual budgets

Owner

Preparation of monthly reports┃ Areas of Real Estate Management Operations┃

Issuing invoices/Confirmation of
payment/Payment of expenses

Arrangement of move‐in

Tenancy screening/Negotiation for conclusion

TenantManagement

Agency’s relation

Direct leasing

Instruct/Judge

Marketing/Sales strategy planning

Checking completion of agreements on
termination/Restoration

Rent negotiations (raising/lowering)

Handling delinquent tenants

Preparation of detailed building
regulations/Guidance for tenants

Responding to tenants (responses tocomplaints, etc.)

APPENDIX

Property Management
The XYMAX Group provides consistent real estate management and operation services, ranging from Property Management(acting for owners) to Building Maintenance operations. In addition, the XYMAX Group owns all kind of data on real estate
management through a track record accumulated over the years.
┃ Data Related to Real Estate Management ┃Contracted rent data
41,718 buildings / 142,373 cases

Asking rent data
59,151 buildings (accumulated total as of March 31, 2023)
19,254 cases (as of March 31, 2023)

Construction work data
173,316 cases (accumulated total as of February 28, 2023)(accumulated total as of March 31, 2023)

Building
Management

48

APPENDIXITBM Center
The XYMAX Group has built a support system that uses IT to achieve a high‐quality building maintenance.

┃ＩＴＢＭ ＣＥＮＴＥＲ┃XYMAX ALPHA introduces information communication technology in building maintenance operations tomaintain and provide secure and safe conditions.
Creating a more advanced, higher quality, safer and more secure building maintenance framework and value.
XYMAX ALPHA has introduced an initiative called ITBM (Information Technology Building Maintenance) into
building management.

TA (Technical Adviser) Support

Knowledge Support

TAs give backup to all building maintenance sites

Desired information can be accessed anytime, anywhere from a
dedicated website

While they are stationed at the ITBM Center, TAs use their knowledge, technology,
and know‐how in building maintenance based on their experiences at various sites tobackup all site operations.

Information on managed properties as well as knowledge and information concerningbuilding maintenance operations are aggregated into a database. Information can beaccessed anytime, anywhere from devices at all sites.

Real‐Time Information Gathering During of an
Emergency or Disaster

Checking with and giving instructions to thesite by the ITBM CenterIn times of fires or natural disasters, information can be shared with therelevant divisions and head office functions on a real‐time basis using
video from smart devices connected on‐site with the ITBM Center.
Videos sent from the site can be shown on a large display. The
information can be used for real and accurate status reporting, as thevideos and audio exchanged between the both are recorded
automatically.
Video at the time of a fire in abuilding near a property managed by
the Company.
The video was linked to the ITBM
Center after people in the building
were safely evacuated. It was thenused in reporting the status to theowner and the head office.

Site facility staff (making the rounds/on‐site)

49

APPENDIX

Facility Management
The XYMAX Group conducts integrated management of retail stores of retail chains by providing services that substantiallyreduce the operational burden on store management.
Conventional store management

XYMAX store management system

Issues for clients
Each store• Shortage of manpower instore management• Optimization of cost andspecifications

Corporate
headquarters
Status confirmation

Inquires
Corporate headquarters

Order placement
Facility management
systemService providers

Orderplacement

24‐hour call center

InquiresBenefits of integrated management to clients
 Improving operational efficiency of store management• Introduce call center and store management system• Reduce management staff of headquarters

 Optimizing costs, improving quality• Consolidation of contractors, unification of specifications• Reduce fixed costs (contractor fees) of stores

 Ensure thorough compliance, response to government agencies

Service providers

Each store• Operations related to response to government agencies, routine inspection• Remedy of compliance violations

50

APPENDIXKey Points by Asset TypeXYMAX REIT believes that quantity and quality of tenant demand are key factors to assess the profitability of real estate.
XYMAX REIT aims for portfolio growth by comprehensively assessing the factors below by asset type.

OfficeRetailHotel

Focus on properties with strong
attractiveness to tenants

Focus on stability of tenant
rent or property price

Focus on hotels specialized in staynear transportation hubs✔

Properties located in the 8 central
wards of Tokyo, Central
Nagoya, Central Osaka andCentral Fukuoka✔

Properties where revenue offacilities is available for analysis✔

Hotels specialized in stay whose
revenue trends can be analyzed based on
the operational know‐how of the sponsor✔

Properties with a unit rent of 10,000
yen to 20,000 yen✔

Properties where rent burden on
tenants is available for analysis✔

Properties located in areas offering
excellent access to transportation
hubs✔

Properties located within an approximate
5‐minute walk from the nearest station✔

Properties where sales price islower than the market pricenumber of overseas visitors is✔ expected
to increase
Properties located in areas where the

80% or more of the portfolio consists of office, retail, and hotel properties
51

APPENDIX

Original Sourcing Strategy
XYMAX REIT captures the needs for real estate disposal gained from the huge customer base of the XYMAX Group.
In addition, XYMAX REIT grasps the trend of real estate owners at an early stage through daily communication, so that opportunities are created for external growth.

┃Direct relationship with real estate owners┃

 More than 70% of real estate owners are concerns over about large‐scale renovations of owned properties,
tenant management, and securing funds for reconstruction
 Identifies needs of property disposal arising due to the problem or concern about necessary funds

Acquisition

XYMAX REIT

 Concern for inheritance and business succession tends to increase as real estate owners get older
 Identifies needs of property disposal upon business succession and inheritance by building owners

Asset Management Company
Realization of external growth

Capture disposal
needs

XYMAX Group

Survey on building owners’ situations by XYMAX Real Estate Institute┃Anxiety in future building business (by the number of owned buildings)┃

Owner relationship, customer base
Building owners

General businesscompany

Concerned

OthersFinancing
InheritanceROE management

Financing

Management of tenants
for large‐scale renovation
and reconstruction

3 buildings or more

Securing funds for large‐
scale renovations andreconstruction

3 buildings or more

Measures against
inheritance and businesssuccession

3 buildings or more

1‐2 buildings24%

1‐2 buildings

16%

Number ofproperties undermanagement

1,126

Others40.7%

J‐REIT
21.0%

Individual,
etc.
38.4%

● J‐REIT
J‐REITs including XYMAX REIT
● Individual, etc.
Individuals, asset management companies,
general business companies, etc.
● Others
Private REITs, private funds, real estatecompanies, etc.
Source: The asset management company based on material
provided by XYMAX Corporation

23%
24%

46%

24%

39%

20%

45%
45%

20%

┃Diversity among real estate owners┃(As of the end of July 2023)

20%

42%
52%

30%

1‐2 buildings

Not concerned

50%

36%

0%

Percentage of client types for real estate management business

Slightly concerned

30%

40%

35%
60%

80%

100%

Source: “Building Owner Survey 2017” by XYMAX Real Estate Institute┃Concerns over future building business (By age, multiple answers)┃
Management of tenants forlarge‐scale renovation andreconstruction
Securing funds for large‐scalerenovations andreconstruction

Concerned

Slightly concerned

40%

60%

Not concerned

49 or younger
50‐59
60‐69
70 or older
49 or younger
50‐59
60‐69
70 or older
49 or younger

Measures against inheritanceand business succession

50‐59
60‐69
70 or older

0%

20%

80%

100%

Source: Created by XYMAX Real Estate Institute based on the request from the asset management company

52

APPENDIXXYMAX Group’s track record of real estate disposals and real estate brokerage
External growth (number of cases, total amount and area) by capitalizing on track record in real estate
sales and brokerage.
Use and geographical area of real estate in real estate disposals andreal estate sales brokerage results

To investment corporations, etc. */Whole
Disposals and sales
brokerage
Number of cases

39

3.9%

388

Disposals and 158.2 billion yen
sales brokerage
Total

Office1.7%

Retail

9.6%

Hotel

10.3%

610.8 billion yen

49.6%

2.1%

12.2%

23 Wards of Tokyo

19.0%

Tokyo

37.8%

0.7%

Land

Other Tokyo Metropolitan Area

9.4%

Osaka Area

residential

Nagoya Area

4.8%

Logistics

12.8%

Average per 4.0 billion yen
building

5 Wards of Tokyo

21.4%

4.9%

Fukuoka Area

Other

1.5 billion yen

Other

By asset (whole)(based on transaction price)

By area (whole)(based on transaction price)

Source: XYMAX Corporation

Accumulated track record of real estate disposal and brokerage services(accumulated total from April 1, 2010, excluding sales to XYMAX REIT)(hundred million yen)
7,000
6,000

■ Sale and intermediary to other than

5,000

■ Sale and intermediary to investment

12.1 billion yen to investment corporation, etc./Whole 46.9 billion yen(Actual results from April 1, 2010 to March 31, 2023 Fiscal year average)

investment corporations, etc.
corporations, etc.

4,000
3,000
2,000
1,000
0

269

645
427

End of March
2011年3⽉末

2012年3⽉末
2012

2011

End of March

934

1,251

1,676

585

694

756

End of March
2013年3⽉末

2014年3⽉末
2014

End of March

2015年3⽉末
2015

2013

End of March

2,071

2,607

2,977

3,323

3,809

4,246

4,335

4,526

1,075

1,148

1,384

1,482

1,491

1,553

1,553

1,583

End of March
2016年3⽉末

2017年3⽉末
2017

End of March

End of March2018年3⽉末

End of March
2019年3⽉末

End of March
2020年3⽉末

End of March
2021年3⽉末

End of March
2022年3⽉末

End of March
2023年3⽉末

2016

2018

2019

2020

2021

2022

2023

Source: XYMAX Corporation* Vehicle for acquisition and holding of properties with the intent to transfer them to real estate investment corporations

53

APPENDIX

Accumulation and Utilization of Original Data by XYMAX Real Estate Institute

XYMAX Groupbusiness

Data accumulation
XYMAX
Group
business

XYMAX Real
EstateInstitute Corp.

Technology /Research and surveys
information providing

Details of the information delivered
We are providing the public with the results ofanalysis and research from a unique perspective
based on the data we have gathered.

XYMAX Real Estate
Institute Website(Japanese version only)

Survey and analysis of the real estate market
 Quarterly announcement of benchmarks
for the rental office market
 Development of new
benchmarks/contracted rent DI, newcontracted rent index, etc.
 Disclose the Office Pyramid Announcement of forecasts for thevolume of new offices in Tokyo and Osaka Fact finding surveys of small and medium‐sized building owners
 Fact finding surveys of retail stores(renovations, openings/closings)

Publication OfMass media
information

Society andVariousthe public
media

Posting, contribution and lectures to mass media
and various media (examples)Posting

Various newspapers, magazines, TV, andothersContribution

ARES Real Estate Securitization Journal
The Japanese journal of real estate sciences
Real Estate Fund Review, etc.

Lectures

Ministry of Land, Infrastructure, Transport
and Tourism
Tokyo Metropolitan Government
The Real Estate Companies Association ofJapan (RECAJ)(A public interest incorporated association)
Japan Facility Management Association
Japan Building Management InstituteJapan Telework Society, etc.

Joint study

Hitotsubashi Univ., Waseda Univ.,
Keio Univ., Nihon Univ., Univ. of Hyogo, etc.

Survey and analysis of tenants
 Announcement of office floorspace per person and rent per person
 Analysis of lease periods of office tenants and retail tenants Tenant opinion surveys regarding offices, office fire prevention, how offices are being used, etc.

Survey and analysis of energy

Survey and analysis on workstyles
and offices

 Survey on energy consumption and costs foroffice buildings
 Analysis of the economic feasibility ofenvironment management Survey on office demand in major
metropolitan areas
 Survey on office workers in the Tokyo
Metropolitan Area

54

APPENDIX

Office Market Analysis┃Office market cycle in the 23 wards of Tokyo ┃(New contracted rent index)

Rent Index (100=2020 Q1)

Rent Index (100＝2020 Q1)

2008Q2

120
110┃ New contracted rent by office building scale┃
130

Small‐ and medium‐scale office buildings(total floor area: less than 5,000 tsubo)
Large‐scale office buildings(total floor area: 5,000 tsubo or more)

120

2020Q2

110

100

100

2023Q290

90
80

2005Q1

80

70

2010Q270

Q1: Jan. ‐ Mar. Q3: Jul. ‐ Sep.
Q2: Apr. ‐ Jun. Q4: Oct. ‐ Dec.

60

60
0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

( Vacancy rate︓ ％)

2022
Q2

2022
Q3

2022
Q4

2023
Q1

2023
Q2

Vacancy rate

3.91%

4.02%

3.88%

3.68%

3.71%

New contracted
rent index

85

91

87

90

89

Source: XYMAX Real Estate Institute Corp. (Vacancy rates for March 2011 and before are calculated based ondata from a major leasing brokerage company)

2022
Q2

2022
Q3

2022
Q4

2023
Q1

2023
Q2

Small‐ and medium‐scale
office buildings (total floorarea: less than 5,000 tsubo)

88

92

89

93

91

Large‐scale office buildings(total floor area: 5,000
tsubo or more)

83

91

85

88

88

Source: Survey Report by XYMAX Real Estate Institute Corp. “Office Market Report Tokyo Q2 2023”

55

APPENDIXXYMAX Group’s Expanding B to C Business Activities (ZXY)
Membership satellite office business “ZXY” leading work‐style reform┃ New work‐place for “ZXY‐Work(free work‐style)”┃Using clean energy
Energy, including electricity
and gas at all of ZXY’s directly
managed, is in effectelectricity sourced fromrenewable energy.
*We have procured and areusing J‐Credits for renewableenergy equivalent to theannual CO2 emissions for
FY2022.

Starting in December 2022,
we began a partnership with
CocoDesk, which is operatedby FUJIFILM Business
Innovation Corp.
A total of 100 CocoDesks
installed mainly in Tokyo
Metro stations became
available for use via ZXY
members’ website.

Change in number of memberships and workplaces
Members

Workplaces

650,000

300

600,000
550,000

Members

Workplaces

270
240

500,000
450,000

210

400,000180

350,000

150

300,000
250,000
200,000
150,000
100,000
50,0000

We have 294 directly‐managed locations across Japan, as of the end of August 2023.
In 2023, progress was made in opening additional locations in areas
with high occupancy rates while also opening locations in local areas,
and the accumulated floor area reached 13,000 tsubo.

120
90
60
30
0

In August 2023, we opened ZXY Sakae, our first locationin the Nagoya area.
Apart from the Tokyo Metropolitan Area, our location network
has expanded to include major local cities, i.e., Sapporo,
Sendai, Nagoya, Osaka, and Hakata.
Source: XYMAX Corporation

56

APPENDIXXYMAX Group’s Expanding B to C Business Activities(karaksa hotel)
The XYMAX Group is expanding its own brand, “karaksa hotel” nationwide mainly targeting tourists
Tokyo
May 2019
July 2019
Mar. 2023

karaksa hotelcolors Tokyo Yaesu

Hokkaido

57 rooms karaksa hotel premier Tokyo Ginza *151 rooms karaksa hotel TOKYO STATION *95 rooms karaksa hotel colors Tokyo Yaesu *karaksa hotel premier Tokyo Ginza

Jan. 2018

177 rooms karaksa hotel Sapporo*

karaksa hotel TOKYO STATION

karaksa hotel Sapporo

Osaka
Nov. 2017
Nov. 2019112 rooms karaksa hotel Osaka Namba *396 rooms karaksa hotel grande Shin‐Osaka Tower *Kyoto
Mar. 2016 36 rooms
karaksa hotel Kyoto I *karaksa hotel Osaka Namba

karaksa hotel grandeShin‐Osaka Tower

karaksa hotel Kyoto I
Source: XYMAX Corporation (as of August 2023)* As of the date of this material, XYMAX REIT has not determined the acquisition of these properties and there is no guarantee that XYMAX REIT will acquire them in the future.

57

Disclaimer
This document is provided solely for informational purposes with regard to XYMAX REIT Investment Corporation (hereinafter, “XYMAX REIT”) and is not intended
to serve as an inducement or solicitation to trade in any product offered by XYMAX REIT. Decisions on investments are to be made using your own discretion andresponsibility.
Purchase, sale and such of XYMAX REIT’s investment units entail the risk of incurring a loss due to fluctuations in the investment unit price.
Please consult with your securities company regarding the purchase of XYMAX REIT’s investment units or investment corporation bonds. Information presented
in this document should not be interpreted, unless otherwise specified, as constituting disclosure documents or an asset management report required under
Financial Instruments and Exchange Act or the Act on Investment Trusts and Investment Corporations.
XYMAX REIT and XYMAX REAL ESTATE INVESTMENT ADVISORS Corporation (hereinafter, the “Asset Management Company”) to which XYMAX REIT entrusts the
management of its assets are taking all possible measures to make the information contained in this document the best available. However, no assurances canbe given regarding the accuracy, validity and completeness of the information, regardless of whether it is information prepared by XYMAX REIT or the AssetManagement Company, or information received from a third party.
Among the information provided in this document, statements other than those pertaining to facts in the past or present are forward‐looking statements
presented by XYMAX REIT or the Asset Management Company according to assumptions or judgement based on information available as of the date of thisdocument (the date if specified otherwise in the document). Forward‐looking statements are based on assumptions such as the investment policy of XYMAXREIT, applicable laws and regulations, market environment, interest rate environment, business practice and other factors as of the preparation date of thisdocument, and do not reflect or consider changes in situations after the preparation date. Forward‐looking statements include, explicit or implied, uncertainties
of existing risks, unknown risks and other factors, and may materially differ from actual performance, business results, financial status and such of XYMAX REIT.
Although this document includes statements concerning future performances, expectations and other forecasts, such statements do not guarantee the future
performances, expectations and other forecasts.
The content of this document is subject to change or repeal without prior notice. XYMAX REIT and the Asset Management Company are under no obligation to
update or publicly disclose the content of this document (including forward‐looking statements).
Duplication or reproduction of any content presented in this document without the prior consent of XYMAX REIT or the Asset Management Company is strictly
prohibited.

58

〜Memo〜59